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1031 Exchanges
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Updated almost 4 years ago,

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1031 exchange, rent to equity possibility?

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Parents would like to do a 1031 exchange to a new house for their daughter and son-in-law to live in. Daughter and Husband would pay market rent, but are hoping to be actually be building equity in order to take ownership ar some point. Is there some way this is possible? Could parents take rent from daughter in order to have 1031 exchange stay valid, but then gift some partial equity/ownership to her each year? Or would that set off irs alarm bells? Also, does a SEFA make sense for duaghter acquire more percentage of ownership over timeor would they daughter be stuck with just her equity share until sale of property?

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